MCX gold opened positive after the Fed warned of lower growth fears in the second quarter
Gold prices edged a tad higher on Thursday after the US Federal Reserve in its two-day policy meeting decided to keep the interest rates near zero and warned of an “unprecedented” drop in second-quarter GDP. On MCX, gold June futures were trading Rs 53 higher at Rs 45,599 per 10 grams, while silver July futures were up Rs 158 or 0.37 per cent at Rs 42,520 per kg. “MCX gold opened positive after the Fed warned of lower growth fears in the second quarter,” Jigar Trivedi, Fundamental Research Analyst – Commodities, Anand Rathi Shares and Stock Brokers, said. “The dollar nursed losses after the Fed left the door open to more monetary easing and dampened expectations for a quick economic recovery from the coronavirus pandemic. The sentiment is positive in the yellow metal,” Jigar Trivedi said.
Globally, gold edged lower on Thursday as risk appetite improved after positive trial results of an experimental COVID-19 treatment and a jump in oil prices, while the U.S. Federal Reserve’s vow to support the battered economy underpinned the safe-haven metal, according to Reuters. Spot gold fell 0.1 per cent to $1,708.85 per ounce by 0141 GMT. U.S. gold futures rose 0.7 per cent to $1,725.00 per ounce. Palladium rose 0.6 per cent to $1,947.94 an ounce and platinum gained 0.2 per cent to $776.32 per ounce, while silver fell 0.8 per cent to $15.24 per ounce. “The US economy contracted in the first quarter at its sharpest pace since the Great Recession as stringent measures against COVID-19 have impacted the economy. The broader trend on COMEX could be in the range of $1698-1735 and on domestic front prices could hover in the range of Rs 45,345-46,040,” Navneet Damani, VP, Motilal Oswal, said.
In other development, the factory activity in China expanded for the second consecutive month in April as more businesses resumed work from the coronavirus-led shutdowns. Back home, BSE Sensex was up 1,000 to trade at 33,713, while the broader Nifty 50 index advanced 280 points or 2.93 per cent to 9,833.
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